Deposit Mobilization Essay

Introduction

1. 1 Study Background

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For the development of any state. the fiscal sector of that state is responsible and must be strong. The fiscal sector is huge field. which comprises of Bankss. co-ops. insurance companies. fiscal companies. stock exchange. foreign exchange markets. common financess etc. These establishments collect idle and scattered money from the general populace and eventually put in different endeavors of national economic system that accordingly help in cut downing poorness. addition in life manner of people. increase employment chances and thereby developing the society and state as a whole. Therefore. today’s construct. the fiscal establishments and commercial Bankss has become one of the bases for the mensurating degree of economic development of state.

Commercial Bankss are the chief beginning which motivates people to salvage their net incomes. Bank trades in accepting the economy of people in the signifier of sedimentation aggregation and put it in the productive country. They give the loan to the people against existent and fiscal assets. They transfer pecuniary beginnings from rescuers to users. In other words. they are intermediate between loaner and receiving system of fund they mobilize the depositor fund. Whereas in Nepal the function of joint venture Bankss are still to be realized as an necessities machine of mobilising internal salvaging through assorted banking strategies in the economic system. Hence. to elate the backward economic status of the state. the procedure of capital accretion. among other requirements should be expedited.

This undertaking study has been prepared as an end product of the researcher’s internship experience in Nepal Credit and Commerce Bank Limited. Nepal Credit and Commerce Bank Ltd. ( NCC Bank ) officially registered as Nepal- Bank of Ceylon Ltd. Commenced its operation on 14th October. 1996 as a Joint Venture with Bank of Ceylon. Srilanka. It was the first private sector bank with the largest authorised capital of NRS. 1000 million. The Head Office of the Bank is located at Siddhartha Nagar. Rupandehi. the place of birth of LORD BUDDHA. while its corporate office is placed at Bagbazar. Kathmandu.

1. 2 Statement of the Problem

Nepal is developing state and rapid economic development is the basic demand of the state. Development by its agencies is non possible within a short period and it takes a long clip for the proper development of a state. it has to construct up substructure. In Nepal. the procedure of development started merely after 1956 A. D. when the first five twelvemonth program came into pattern.

Capital in fact. plays the prima function for the economic development of a state. But in Nepal. there is deficit of capital. There are assorted beginnings of roll uping capital internal and external beginnings. Under external beginnings: assistance. grants and loans are the chief beginnings. In internal beginnings: roll uping capital. revenue enhancements. public endeavors. public debt are the popular in our state. But due to underdevelopment. poorness. deficiency of banking cognition the coveted capital for the development of the state can non be accumulated from those internal beginnings. So. it can be said that in Nepal’s present state of affairs bank sedimentation is reliable and lasting beginnings of capital accretion. The demand of sedimentation mobilisation for economic development of a state is no more to inquiry. But we are confronting an ague job of resources mobilisation. We have 32 commercial Bankss in Nepal which are really much considered to be critical fiscal establishment to mobilise domestic resources.

1. 3 Objective of the Study

The aim of the survey is to analyze relationship between the sum of entire sedimentation and sum of entire recognition granted by the bank. The chief aims of the survey are:

* To analyse the relationship between sedimentations and loans and progresss. * To analyse the effectivity of sedimentation mobilisation of the bank. * To analyze how far the involvement rates of sedimentations have positive relationship with the sedimentation aggregation of the bank. * To mensurate the impact of involvement rates of loan on the recognition extended by the bank. * To pull suggestions and recommendations to the concerned bank for the farther betterment.

1. 4 Significance of the Study

Banks and other fiscal establishments play of import function to increase economic criterion for the development of the state. Economic development becomes slow if there are uncomplete and unjust banking installations. Particularly commercial Bankss provide different economic and proficient installations to the people who involve in concern activities. Commercial Bankss play major function in aggregation of frightened little nest eggs signifier depositors and reassign these financess into productive sectors for the economic development.

Chiefly this survey covers the sedimentation and recognition place of commercial bank ( NCC ) . so it helps to uncover the fiscal place of bank and survey occupies an of import function in the series of the surveies on commercial bank. The significances of the survey are: * Important to cognize how good the bank is using its sedimentations. * Important to policy formulator and besides be utile for academic professionals. pupils peculiarly those involves in commercialism. CA and fiscal establishments to explicate policies and programs on the footing of the public presentation of the bank. * Important to the direction party of the bank for the rating of the public presentation of their bank and comparing with other Bankss. * Important for the investors. clients ( depositors. loan takers ) and forces of bank to take assorted determinations sing sedimentations and loan progresss. * This survey will be every bit of import to the others who are interested to cognize about the country. It may promote to researcher to research farther.

1. 5 Relevance of the Study

Presently. Bankss are deriving the stakeholders’ belief through their efficient direction and professional services and playing an high function in the economic system. The sedimentation mobilisation for the bank is tough occupation. So. the survey is focused on how the sedimentations are mobilized by the bank. The survey efforts to complect the fiscal public presentation and the sedimentation mobilisation of the bank.

The survey is expected to be utile to different stakeholders as: 1. The survey is expected to be utile to the stockholders as they can analyse the hazard associating to recognition. 2. The survey is expected to be utile to the direction organic structures of the bank to better the operations of the bank to add more value to its service 3. The survey is expected to be utile to the authorities organic structure. NRB for farther research is the country to explicate and implement new policies and ordinances. 4. The survey is expected to be utile to the other stakeholders to cognize the patterns made over the sedimentation mobilisation by the bank 5. The survey is expected to be utile to analyse the internal strengths and failings of the bank 6. The survey is expected to be utile to anyone who is carry oning a bank study in the related subject.

1. 6 Research Questions

The survey intends to uncover the undermentioned issues of sedimentation mobilisation patterns by the bank: 1. What is the relationship between sedimentation and loans and progresss? 2. What is the effectivity of sedimentation mobilisation of the bank? 3. How far the involvement rates of sedimentations have positive relationship with the sedimentation aggregation of the bank? 4. What is the increasing or diminishing tendency of sedimentation mobilisation of the bank?

1. 7 Restrictions of the Study

As every research has its ain restriction. this survey is non biased. The research is done for the partial fulfilment of MBA. Therefore. this survey has some restrictions. which are listed below: * This research survey mostly depends on the secondary informations like one-year studies ( Net income and Loss Account. Balance Sheet and Financial Statements ) . * The survey is based on lone fiscal and statistical tools and engineering. * The survey chiefly based on last five old ages informations ( 2003 to 2008 ) that are non plenty for the statistical computation and can non be generalized for full fiscal sectors.

1. 8 Organization of the Report

Chapter one deals with the general background of the survey and the major issues which has governed the overall survey. chapter two trades with the nature of Nepal’s banking industry and challenges of banking sector in Nepal. chapter three trades with the qualitative facet of Nepal Credit and Commerce Bank Limited which gives the debut of major merchandises and services provided by NCC Bank and new advanced merchandises late launched by NCC Bank. chapter four trades with presentation and analysis of informations and Finally chapter five trades with the findings of the survey and the recommendations which have been given to the bank for bettering its sedimentation mobilisation.

Chapter II
REVIEW OF LITERATURE

2. 1Review of Literature

Deposit is the amount of money lodged with a bank. price reduction house or other fiscal establishment. Deposit is nil more than the assets of an person which is given to the bank for safe-keeping with an duty to acquire something ( involvement ) from it. To a bank these sedimentations are liabilities. Commercial bank Act 2031 ( 1974 ) defines “Deposits” as the sum deposited in a current. nest eggs or fixed histories of a bank or fiscal establishment. The sedimentations are capable to backdowns by agencies of check on a short notice by clients. There are several limitations on these sedimentations. sing the sum of sedimentation. figure of backdown etc. These are considered more as investings and hence they earn some involvement. The rate of involvement varies depending on the nature of the sedimentations. The bank attracts sedimentations from clients by offering different rates of involvement and different sorts of installations. Though the bank plays an of import function in act uponing the client to salvage and open sedimentation histories with it. it is finally the client who decides whether s/he should lodge his excess financess in current sedimentation a/c. salvaging sedimentations or fixed/time sedimentation a/c.

Bank sedimentations arise in two ways. When the banker receives hard currency. it credits the customer’s history. it is known as a primary or a simple sedimentation. Peoples deposit hard currency in the banking system and thereby change over one signifier of money. hard currency. into another signifier. bank money. They prefer to maintain their money in sedimentation histories and issue checks against them to their creditors. Deposits besides arise when clients are granted adjustment in the signifier of loans. When a bank grants a loan to a client it doesn’t normally pay hard currency but merely credits the clients account with the sum of loan. Of class. there is nil that prevents the borrower from retreating the full sum of borrowing in hard currency but rather frequently s/he retains the sum with the bank as sedimentation.

Chapter III
RESEARCH METHODOLOGY

To work out the research jobs. few systematic ways are adopted to roll up the needed informations and information. Research methodological analysis refers to the assorted consecutive stairss that are to be adopted by a research worker during the class of analyzing the job with certain aims. It shows overall research method from the theoretical facets to the aggregation and analysis of the information. This survey covers quantitative methodological analysis in a greater extent and besides uses the descriptive portion based on both proficient and logical facet. This survey tries to execute a well designed. quantitative and qualitative research in a really clear and direct manner by utilizing both fiscal and statistical tools.

3. 1 Research Design

This survey is based on a descriptive research design and follows an analytical attack. To accomplish the survey aims. the needed informations are collected from secondary and primary beginnings and analyzed through the usage of different fiscal and statistical tools.

3. 2 Research Tools

In order to roll up the information. the research worker had visited the bank as an houseman for 8 hebdomads of clip period. The tools that are used for the survey is through direct observation at the clip of internship. and treatments with the officers of the bank in concerned section.

3. 3 Data Collection Method

The methods of roll uping informations are primary and secondary. Primary information includes personal observation. informal talk and besides interview with officers whereas Secondary informations includes Annual study of the bank. published and unpublished paperss etc.

3. 4 Data Analysis Tools

The processed informations were analyzed and tested with the fiscal tools i. e. Ratio Analysis. Trend Analysis. graphs whereas Statistical tools are Karl Pearson’s Coefficient of Correlation Analysis. Probable Error ( P. E ) and Hypothesis Testing.

Bibliography

Books

* Annual Report of NCC Bank limited 2003/04 – 2007/08.
* Kathmandu Frontier Associates ( KFA ) . Professional Banking Course mentions. * Levin R. I and Rubin D. S. ( 2008 ) . “Statistics for Management ( 7th Ed. ) ” . Pearson Prentice Hall. New Delhi * Sharma. Pushkar Kumar and Chaudhary. Arun Kumar ( 2058 ) . “Statistical Methods” . Kathmandu: Khanal Books Prakashan. * Van Horne. C. James ( 2005 ) . “Financial Management and Policy” . ( 12th Ed. ) . Pearson Prentice Hall. New Delhi.

Web sites
World Wide Web. nrb. gov. neptunium
World Wide Web. Google. com
World Wide Web. wikipedia. com
World Wide Web. nccbank. com. neptunium